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Matt was born and raised outside Boston, and after his hockey career fizzled at age 13 he decided to become a writer. Now he covers retail and all things shopping for DailyFinance, where he’s constantly finding new ways to help readers save money. He’s as thrifty as you can possibly be while living in New York City, and the only time he’s ever made an impulse purchase was when he bought himself one of those singing fish for $20 a few years ago. He still hasn’t forgiven himself.

AP Photo/Paul SakumaTesla CEO Elon Musk and a Model S electric car.
Tesla CEO Elon Musk defended the Model S electric car on Friday after a fire in one of the cars sent shares tumbling.

This week video emerged of a Tesla Model S engulfed in flames following an accident in Washington state. The resulting bad press proved disastrous for the share price, with the company losing more than $2 billion in market value. On Friday, the company's CEO sought to get out ahead of the story in an extensive blog post explaining why the car had caught fire -- and why consumers and investors shouldn't be concerned.

The car, wrote Musk, ran over a curved object that had fallen off a semi-truck, puncturing the underside of the vehicle and starting a fire in the battery pack. Musk emphasized, though, that the design of the Model S contained the fire to the front section of the car and allowed the driver to pull over and exit the vehicle unharmed. It wasn't until the fire department punctured holes in the battery in an attempt to extinguish the fire that the car was engulfed in flames.

"It is important to note that the fire in the battery was contained to a small section near the front by the internal firewalls built into the pack structure," wrote Musk. "Had a conventional gasoline car encountered the same object on the highway, the result could have been far worse."

Musk went on to post an exchange between the car's owner, Robert Carlson, and a Tesla executive.

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"I agree that the car performed very well under such an extreme test," wrote Carlson, who added, "I am still a big fan of your car and look forward to getting back into one."

Carlson also noted that he was a Tesla investor, and we're guessing he's not thrilled that his own car accident is hurting his stock portfolio.

Based on Musk's description, it does sound like this was a freak accident. But it's unclear whether skittish investors will see it that way. The pricey electric car has faced an uphill battle against public skepticism, and Musk himself has publicly engaged critics who questioned the car's viability and design. And despite receiving a five-star safety rating, any hint that the car is a safety risk is going to hurt sales.

Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.

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John Riley

The incident of Tesla S catching fire can't be taken in isolation. More importantly, Tesla has not yet generated a full fiscal year profit, and its earnings per share estimates of $1.67 for 2014 do not justify its current stock price of $181, or its one-year forward price to earnings (P/E) multiple of 195x.

Read and understand more on: http://goo.gl/uwWX4T

My personal on Tesla is to be careful and watch out. Something is fishy.

I won a Volt - great car. In 16,000 miles I have used just 98 gallons of gas. The majority of the miles on this car have been electric. The car goes about 42 miles on a charge, which takes a bit over 2 hours on the fast charger at night, so it's ready to go in the morning. It can also be charged from a 110 volt socket in about 6 - 8 hours.

My typical commute and running errands during the day is about 30 miles., well within the 42 mile electric range. Here in Illinois we have almost all electricity generated with either nuclear or wind powered. In fact, there are charging stations all over this area, where I can plug my car in while shopping or dining. Charging is free, and they work for all electric cars including the Volt and the Tesla sedan. With my old sedan that 16k miles would have consumed at least 800 gallons of dynosaur juice, at $3.50 - $4.00 per gallon at a cost of $2800 to $3600. Not counting the oil changes and other service items.

The Tesla is my next car after the Volt. It is an awesome car and is very popular in Chicago. In fact, it outsells the other high end sedans from Europe (BMW and Mercedes). The car dealers are of course enraged that you can buy a Tesla over the internet and have it delivered to your door. No dealer markups and other nonsense. You get exactly the car that you ordered.

Yes, and they pay big subsidies to the hugely profitable oil companies that we put into our crankcase, transmission, and fuel tank too. If you want to be realistic about it, at least them giving the tax credit on a EV helps the environment, except in states where coal is the main source of power generation. That will change soon too since the government is basically going to ban coal producing power generation with the new regulations on power plant emissions.

Have you found time to know God? Do you "really know" how that color T.V. works? Well then you won't ever understand a women....Big Norm P.S.: So if your batteries get a little hot, you better go see my dog spot!

Beautiful car. It was parked at our local park and was surprised at how well designed it was for an EV. The major culprit for fire accidents is the lithium-ion batteries which are more powerful and easier to recharge than its than the older cadmium batteries were. But they tend to overheat. The industry has been working on that issue for a decade but fall short of fixing that problem with better engineered insulation and cooling technologies instead. Panasonic supplies Tesla with these batteries but are losing money in the process. The recent Boeing 787 fire accidents can be attributed to the same technology. Mitsubishi-Yuasa supply Boeing with these batteries. The Mitsubishi EV's are also experiencing fire mishaps from this lithium technology. So this problem is endemic to lithium, not from outright incompetence. To go back to cadmium means more volume and weight added to the automobile and less efficient to run. A safer design is now the priority to make EV's safer to run on lithium batteries.